Products: Hawaii's Economy
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New Perspectives on Land and Housing Markets in Hawaii
Land leasing is common in Honolulu, with many owners of residential, industrial, and commercial buildings leasing land. This report examines land and housing markets in Honolulu and the mainland United States to understand better why prices and lease rents are so much higher in Honolulu than most other US cities. Three stylized facts stand out:
- Census data show that Hawaii home prices were already exceptionally high in 1950.
- Over the last six decades, inflation-adjusted land and housing prices in Honolulu register small annual real increases.
- Honolulu’s inflation-adjusted land and housing prices have been highly volatile in the medium term since the 1960s, forcing market participants to bear high levels of risk.
CCIM Forecast 2016 Conference Presentation
Carl Bonham presented UHERO's 2016 Annual Hawaii Forecast at the Certified Commercial Investment Member (CCIM) Forecast 2016 panel on January 26, 2016.
Making an Optimal Plan for 100% Renewable Power in Hawaii
The State of Hawaii has adopted the unprecedented goal of building a 100 percent renewable power system by 2045. This report identifies some of the central challenges in achieving this goal and uses the SWITCH power system planning model to identify solutions to these challenges. A 100% renewable power system must balance electricity supply and demand on two main time scales: diurnal (providing enough power each hour of the day) and seasonal (providing enough total energy on each day of the year). The diurnal balance could be achieved by installing large amounts of primarily solar production capacity, then using batteries, demand response, biofuels or hydrogen production to shift power production and/or consumption between day and night. The seasonal balance may be more challenging. Energy demand during days or weeks with low sunlight could be met by building extra solar and wind capacity, using biofuels, or using hydrogen produced during sunny months. Demand response will likely be less expensive than the other options for day-night energy balancing, and customer-sited solar may be competitive with utility-scale solar; consequently electric utilities may need to become energy integrators and market managers, rather than bulk power providers.It is unclear how much biofuel the State could use without compromising other environmental and energy independence objectives; consequently hydrogen energy storage merits serious consideration. SWITCH or similar models can be used to identify optimal long-term plans; however, a new incentive system is needed to encourage the State's utilities to develop and implement such plans, regardless of who will own the generating equipment.
The Conversation: Carl Bonham on the Annual Hawaii Forecast
UHERO Executive Director Carl Bonham appears on The Conversation to talk about UHERO's Annual Hawaii Forecast: Expansion Will Continue, Despite Global Challenges.
Annual Hawaii Forecast: Expansion Will Continue, Despite Global Challenges
This year has turned out a bit better than anticipated, and prospects remain good for 2016. Next year will see some easing of visitor growth, but no retreat from the high levels of activity that have built up in recent years. The construction expansion will continue, and tightening labor market conditions will support income gains. Arrayed against this positive outlook are important global challenges, ranging from the surging dollar to Chinese slowing and renewed terrorism threats.
The Conversation: Carl Bonham on the State Forecast Update
UHERO Executive Director Carl Bonham appears on The Conversation to talk about UHERO's State Forecast Update: Except for Weather, Outlook Shines.
UHERO State Forecast Update: Except for Weather, Outlook Shines
Hawaii’s economic outlook continues to look bright. Tourism is pushing toward new records, and the construction upswing is building in strength. The overall expansion remains solidly on track, delivering better labor market conditions and the prospect of further household income gains. Still, in the midst of this hot and soggy summer we are pondering some ominous clouds forming out on the horizon.
KITV: Carl Bonham on Falling Gas Prices
UHERO Executive Director Carl Bonham appears on KITV to talk about the effects of falling gas prices on Hawaii's economy, as well as the latest State Council on Revenues general fund forecast.
The Conversation: Carl Bonham on the State Council on Revenues General Fund Forecast
UHERO Executive Director Carl Bonham appears on The Conversation to discuss the State Council on Revenues forecast for the 2015 fiscal year.
ThinkTech Hawaii: Makena Coffman on Sustainable Hawaii
Balancing Opportunities and Costs in Hawaii's Increasingly Green Grid
Hawaii’s tourism-dependent economy and oil-fired power plants make it the most oil dependent state in the United States. It also has the nation’s highest electricity prices, often between 3 and 4 times the national average over the last decade. These high prices, the state’s sunny and windy climate that make it amenable to increasingly economical renewable energy, plus a relatively progressive political culture have pushed the state to adopt an ambitious goal of being 100 percent renewable by 2045. Focusing mainly on the state’s largest grid on Oahu, where most people live, we discuss the cost structure of the current electricity system, the potential benefits and challenges of growing the share of renewable energy, and make a few policy suggestions. In particular, we argue that all homes and businesses should be given an opportunity to buy and sell electricity at the marginal cost of generation. Variable pricing could greatly reduce the cost of renewable energy, and perhaps seed development of Hawaii as a technology center focused on batteries and smart machines that can help shift electricity demand to align with the variable supply of solar and wind energy.
UHERO County Forecast: Neighbor Island Tourism Still Has Room to Grow
After a rather soft 2014, the counties are poised for better performance over the next several years. Tourism will see additional healthy gains on the Neighbor Islands for the next two years, before rising occupancy and costs begin to bring down growth rates, something that has already occurred on Oahu. Construction, which has disappointed so far, will become a significant contributor to growth. Gains in employment have brought unemployment rates down substantially, and moderate expansion of jobs and income will continue, helping to solidify the local spending leg of the economic expansion.
Hawaii News Now: Carl Bonham on Sunrise with Howard Dicus
Vog: Using Volcanic Eruptions to Estimate the Health Costs of Particulates and SO2
Kılauea volcano is the largest stationary source of SO2 pollution in the United States of America. Moreover, the SO2 that the volcano emits eventually forms particulate matter, another major pollutant. We use this exogenous source of pollution variation to estimate the impact of particulate matter and SO2 on emergency room admissions and costs in the state of Hawai‘i. Importantly, our data on costs is more accurate than the measures used in much of the literature. We find strong evidence that particulate pollution increases pulmonary-related hospitalization. Specifically, a one standard deviation increase in particulate pollution leads to a 2-3% increase in expenditures on emergency room visits for pulmonary-related outcomes. However, we do not find strong effects for pure SO2 pollution or for cardiovascular outcomes. We also find no effect of volcanic pollution on fractures, our placebo outcome. Finally, the effects of particulate pollution on pulmonary-related admissions are most concentrated among the very young. Our estimates suggest that, since the large increase in emissions that began in 2008, the volcano has increased healthcare costs in Hawai‘i by approximately $6,277,204.
Sumner La Croix on PBS Hawaii Insights: Will Our Children Ever Be Able to Afford to Live in Hawaii?
There seems to be no end to the rising cost of living in Hawaii. The high prices of housing, groceries, gas and other necessities make it more and more difficult for us to live in today's paradise. But what about our children? If it's this hard to make ends meet now, what will life in Hawaii be like for future generations? UHERO's Sumner La Croix joins Daryl Huff and guests on Insights on PBS Hawaii to discuss how these issues impact the islands' middle class residents.